What is a bear market | INDmoney Classroom #2
What is a bear market?
A declining market in which stock prices fall 20% or more from the recent high and there is a lot of pessimism and negative investor sentiment is known as a bear market. Currently US stocks market is in bear market zone.
Is it good to buy in a bear market?
Long term investors wait for such an opportunity - since the price of quality stocks is a bit cheaper, they buy for the long term and let their wealth compound.
How long does bear market last?
Historically, on average, the bear market lasts for around 1-year and during this time, the stock market index falls by 32% on average.
Why is It called a bear market?
The falling market (more than 20% fall from recent highs) is known as a bear market - drawing an analogy of the way a bear attacks its prey - swiping its paws downward.
When was the last bear market?
We are in a bear market right now in the US - In June 2022, the S&P 500 entered into a bear market after crashing more than 20% from the highs it made in January 2022.